A nature that can’t be changed

Market capitalism, once seen as a source of limitless prosperity, has been singled out in the 21st century as the primary driver of intolerable inequality and unsustainable exploitation in the reckless pursuit of profits. In the absence of any viable alternative system, Corporate Social Responsibility (CSR) has been positioned as the go-to solution for capitalism’s ills: a strategy for putting pressure on companies to create economic and societal value.

The jury is still out on CSR’s effectiveness. Researchers have poured over how to best conceive, plan and implement CSR strategies. Some remain optimistic, seeing a potential to encourage the development of management that challenges the social injustice and environmental destructiveness of current corporate capitalism. Other scholars have been ambivalent about CSR, arguing that it’s merely a smokescreen, concealing the exploitative nature of corporate capitalism – a nature that can’t be changed.

Or can it?

Our research contributes to this debate by drawing from the work of sociologists Eve Chiapello and Luc Boltanski who argued in their book The New Spirit of Capitalism (2006) that this system has reinvented itself no fewer than three times since the end of the 19th century. Capitalism’s most recent incarnation, which materialized since the 1990s, was a ‘project-based’ spirit which justified capitalism as the best way for anyone to express individual creativity and talent. In this study, we ask whether CSR might become a new spirit of capitalism, and usher-in a new, sustainable capitalism 2.0.

According to Boltanski and Chiapello, to be successful a justification of capitalism should be able to offer excitement by convincing people and organizations that working within this system will enliven them, it should offer security by protecting people and their families, and it should offer fairness in determining whose actions should be valued. Let’s look at the naissant CSR-based justification of capitalism and see if and where it falls short… We analyzed 22 influential books on CSR management written by prominent authors in the domain and management gurus, searching for how CSR was justified to readers of those books.

Does a CSR spirit of capitalism offer excitement?

Boltanski and Chiapello argue that capitalism is not exciting in itself, as it involves a restless drive to accumulate capital as well as a ‘willing’ subordination by wage-earners, who have to relinquish both the fruit of their labour and the wealth it generates. In such an order, the ‘spirit’ needs to provide protagonists of capitalism with a source of excitement. The texts we analysed present two distinct but interrelated sources of excitement.

For individuals, CSR offers them a richer, more diverse work experience, where several forms of value—besides financial profits—are considered important. The value-based management made possible with CSR is a way to reinforce the sense of community at work and to consolidate organizational identity and culture.

For organizations, CSR offers an opportunity to accomplish both social and reputational goals by improving the relations between corporations and the wider community in which they operate. This is possible, according to authors, because there is allegedly an alignment between the social and the economic performance of the firm. CSR is a way to restore public trust in the corporate world, it follows that CSR enhances the corporation’s reputation and confirms its licence to operate.

What is remarkable here is that CSR-related sources of excitement appear to be in sharp contrast with the sources of excitement in the previous spirit of capitalism identified by Boltanski and Chiapello. According to them, a central common characteristic of the sources of excitement provided by successive spirits of capitalism relates to ‘freeing’ wage-earners. Texts promoting CSR offer a sharp contrast, stressing one’s duties to the collective. Part of the excitement offered by CSR as a potential new spirit is to reduce what is presented as a current anomie by reconnecting business to wider society, as well as by offering the possibility of aligning the moral values of the protagonists of capitalism with their economic interests.

Part 2 of Prof. Bernard Leca’s feature will appear on Thursday 9th November.

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